Development Of Small And Medium-sized Enterprises Research Articles

The implementation of small and medium-sized enterprise development in the rice sector of Myanmar: Empirical research findings

This study has three objectives in assessing the implementation of small and medium-sized enterprise (SME) development in the rice sector of Myanmar. This study attempted to (a) assess the current status of SME development in the rice sector; (b) identify the level of perceptions of the factors affecting the implementation of SME development in Myanmar; and (c) study the impact of policy implementation on different types of businesses in the rice sector of Myanmar. The factors include policy implementation, market access, financing accessibility, technology acceptance, entrepreneurial capability and internationalization. The conceptual framework was prepared and a questionnaire was designed based on these factors. Thirteen hypotheses were proposed in order to ascertain the factors. The study used active agents of SMEs in three top rice-growing regions of Myanmar as the target population for the primary data. In addition, the representatives of government agencies and business associations as well as relevant experts were alternative sources of data. All of the hypotheses were successfully tested and only 3 out of 13 were accepted. The findings revealed that the capability of implementers and local market access had a highly significant relationship with the income generation aspect of SME development, while financing accessibility and entrepreneurial capability exhibited strong significant influences on the employment generation aspect of SME development. The findings are applicable for policymakers, practitioners, implementers of SME development, and entrepreneurs in Myanmar and other developing countries.

The innovation and performance impacts of venture capital investment on China’s small- and medium-sized enterprises

ABSTRACTThis study examines the impacts of venture capital (VC) on performance and innovation of China’s small- and medium-sized enterprises (SME). Using unbalanced panel data of 2699 VC-backed and non-VC backed firms in China’s pilot over-the-counter equities market, namely the National Equity Exchange and Quotation (NEEQ) market, during 2005–2014, we find that venture capital financing not only spurs innovation in the Chinese market, but also exhibits significantly positive impact on financial performance. Empirical evidence reveals that syndication of venture capital investment as well as the reputation of venture capitalists helps to create value for VC-backed firms. However, no evidence is found that foreign VC-backed firms perform better than domestic VC-backed ones. The results are robust to a variety of specifications. Our findings imply that the VC financing is an effective channel to promote the development of SMEs at China’s multi-layer capital market and syndicated VC investments and venture capitalists with high reputation shall be encouraged to play a bigger role in nurturing innovation and entrepreneurship in the future.

Problems and Ways of Improving the Business Climate in the Regions

The existence of the specific conditions and development factors of small and medium-sized enterprises (SMEs) in the regions of Kazakhstan supposes the differentiated state policy in order to maintain a favorable business climate. The article presents the results of the research whose purpose was to determine the main issues and directions of the improvement of the business climate in the regions. This allows to intensify the activities of local authorities in support of SMEs considering the peculiarities of the territories’ development. The subject matter of this research is the conditions and factors generating the business climate of the region. As a hypothesis, a direct connection between the prevailing regional business climate and the development of the quantitative indicators of active SMEs in the field was assumed. The study used the method of comparative analysis, sociological methods of focus groups, survey research, statistical methods and statistical methods of ranking and grouping. The article theoretically substantiates the correctness of the usage of «business climate» category as a scope of the study in the framework of the project of «Implementation of «Business Climate» as an Independent Rating», which makes possible the argumentation of the used methodology and concretization of the factors affecting the functioning of SMEs in the regions. This research has confirmed the direct correlation between the established business climate in the regions and quantitative indicators of the development of SMEs at the local level. Such factors as “financial resources†and “government support†have been determined as limiting the business development in a greater degree. In conclusion, a set of measures to improve the business climate in the region both at national and regional levels of government has been provided. In addition, it has been concluded that to generate a favorable business environment in the regions of Kazakhstan, it is necessary to make a smooth transition from a policy of “identification and punishment of unfair entrepreneurs†to a policy of “prevention and promotion of good business†. The results of the research can be used in the work of the local executive authorities in order to improve the business climate in the regions of the country.

Innovation and SME Development: Indonesian Experience in Uzbekistan Context

Under the current increased interdependence and market globalization product and service markets have been in constant change. These changes in their turn contributing to the rise of the level of competition putting enormous pressures on enterprises of all sizes to respond quickly to the changes and developments in market affairs. One of the crucial factors of survival in this highly competitive world economy is to find the way to increase the productivity and efficiency while reducing the costs. Thus, the key for success has become enterprise’s capacity to innovate and come up with innovative solutions to the production processes. It is nowhere as obvious as in the case of small and medium sized enterprises (SMEs) whose share and contribution to the overall economy have been increasing, especially, in the developing or transition economies.

State and prospects of Serbian SME development

Small and medium-sized enterprises (SMEs) represent a significant economic, segment of the national economy, primarily because of its entrepreneurial activity, but also because of its contribution to the raising of the overall level of competitiveness of the national economy, which has a positive impact on all fields of social life. In order to point out the importance of the development of the SME sector, this paper presents the results of the state and prospects of development of the SME sector in the Republic of Serbia. The basic premise of the research is that the SME sector is a particularly important factor in the economic development of Serbian economy, having a significant potential for further growth and development. In order to confirm the above assumptions, the research focuses on a consideration of the context of the economic space in Serbia in which growth and development of the SME sector occurs, within which analyses of key economic indicators of the Serbian economy were conducted, altogether with the competitiveness of Serbian economy, as web as of the current state of development of the SME sector in Serbia and the perspectives for the future development of SMEs in Serbia. Based on these analyses, the relevant facts are indicated in relation to the current development the SME sector, as well as to the facts that of determine its further development. There from, trends of the future development of the SME sector are forecasted, as web as the potential ways of future treatment of SME sector.

Stakeholder involvement in intellectual capital system implementation for long-term competitiveness development of SMEs in Thailand

Small and medium-sized enterprises (SMEs) have been recognised on their contribution to national economic growth. A significant number of SMEs had difficulties surviving after the 2007 economic crisis and during an intensive competition in the global market. The implementation of an intellectual capital (IC) system supported with stakeholder involvement contributes to the SMEs in long-term competitiveness development. In this work, we have implemented the IC system based on the process model and the Skandia navigator model. The proposed IC system is the integration of joint application development, business plan, and customer relationship management on three selected SMEs in Thailand emphasising on enhancing stakeholder involvement. The significant achievement in IC categories in human, financial, and customer prospects has been addressed.

Role of the Credit Risk Database in Developing SMEs in Japan: Lessons for the Rest of Asia

Small and medium-sized enterprises (SMEs) play a significant role in Asian economies as they contribute to high shares of employment and output. However, SMEs generally have limited access to finance compared to large enterprises. Given the bank-dominated financial systems in Asia, banks are the main source of financing for SMEs. For financial institutions, it is crucial to distinguish sound SMEs from non-healthy ones in order to avoid the accumulation of non-performing loans. Information asymmetry in this sector can be reduced by using accumulated data on SMEs and by employing credit analysis techniques, allowing lending institutions to recognize healthy SMEs. It is crucial for governments to collect SME data and prepare rich databases, such as the Credit Risk Database (CRD) of Japan. This will also help governments to formulate economic policies. In this paper we define and describe in detail the role and characteristics of Japan’s CRD in SME development and explain how it can be an example for other Asian economies to establish similar soft infrastructure that can make important contributions to SME development and boost economic growth.

Does Access to External Finance Affect Development of Small and Medium Enterprises and Economic Growth?

Small and medium-sized enterprises (SMEs) have become increasingly important in nowadays society as providers of employment opportunities and key players for the well-being of local and regional communities. Access to external funding is one of the largest problem facing SMEs in European Union (EU). Entrepreneurs face difficulties implementing their development plans while creating new businesses, adopting innovation, etc. Scientists also argue that without external funding business cannot achieve good financial performance results. The European Commission (EC) is implementing a number of programs specifically designed to improve the financial environment for SMEs in Europe. Since the financial markets have failed to provide SMEs with the finance they need, the EC has developed and funded various financial instruments. According to the scientists, creating the appropriate conditions for the development of SMEs in each country would possibly reduce the unemployment rate, accelerate country's economic growth, help to overcome social problems, and create competitive environment. Given the current economic situation in the EU countries, the subject's relevance is obvious underlying the importance to assess whether a better access to external funding sources would provide benefits to the countries at micro and macro levels. The main empirical findings of this study confirm the results of early empirical studies that a better access to external funding is an important growth factor for SMEs as well as for the whole economy. The panel regression analysis results suggest that a better access to banks' funding has a positive and statistically significant effect on country's economic growth as well as on SMEs development, however, a better access to equity finance (venture capital, business angels' investment) has no statistically significant effect. While SMEs represent over 99% of businesses in the EU so it is crucial to support their growth and innovation as well as improve the financing environment for small businesses in Europe.

Knowledge strategy and business model conditions for sustainable growth of SMEs

Purpose– The purpose of this study is to figure out the factors for sustainable growth of small- and medium-sized enterprises (SMEs).Design/methodology/approach– In all, 27 SMEs in the area of IT (Information Technology) in Korea were analysed through interview method basically.Findings– It is found that sustainable development of SMEs requires two kinds of open innovation which are knowledge strategy and business model. According to developing process, SMEs change their open innovation strategy in knowledge strategy and business model. The highest growth limit of SMEs depends on open innovation in knowledge strategy and business model in sequence from closed innovation in both, through open innovation in both, to open innovation in knowledge strategy and closed innovation in business model and to closed innovation in knowledge strategy and open innovation in business model.Research limitations/implications– First, the present study was conducted with IT sector SMEs in Korea. It is true that the IT sector is one of the most rapidly changing industrial sectors and is one of representative business types of SMEs in which manufacturing and service industries coexist and diverse sizes of SMEs exist (Malerba, 2002). Second, the present study relies on case study methods. It is true that case study is a method that gives excellent qualitative analysis in firm studies (Yin, 2008).Practical implications– SMEs cannot survive if they do not accept open innovation in knowledge strategy and business model. SMEs that show absolute limitations in resources and manpower should absolutely implement open innovation strategies to secure more diverse resources from markets and external knowledge bases rather than preparing all resources and capabilities by themselves (Van de Vrandeet al., 2009; Yun and Mohan, 2012a, 2012b).Social implications– SMEs should bear in mind the two different levels of open innovation, such as knowledge strategies and business models (Chesbrough, 2007; Chesbrough and Appleyard, 2007).Originality/value– SMEs should not confuse between temporally sustainable development and infinite sustainable development. Firms that take closed innovation strategies in both knowledge strategies and business models can also grow for some time. However, because of the deepening of knowledge-based economy, not only the amount of knowledge existing in the world and the speed of knowledge distribution increased but also the customers’ demands and expectations have been observed to increase in the market immediately through social networking sites (SNS), etc. (Yun and Ryu, 2012).

Internal Barriers to Growth in SMEs

Small and medium-sized enterprises (SMEs) dominate the European business economy, constituting 99.8% of all undertakings in the EU. More interestingly, they account for 58.1% of added value and 66.9% of employment. The development of SMEs is thus crucial to the European economy and at both EU and national levels there have been or are planned further initiatives, such as the Small Business Act for Europe (SBA), to improve the conditions for entrepreneurs and SMEs and promote innovation and growth. Horizon 2020 also actively supports SMEs by providing both direct financial support and indirect support to increase their capacity for innovation. A number of EU initiatives take the form of company law initiatives, aimed at creating a framework that can promote commercial activity. Most recently the Commission has proposed a directive to provide for a single-member private limited liability company (Societas Unius Personae (SUP)). Most initiatives focus on creating better framework conditions for SMEs. However, while a good corporate framework is necessary it is not sufficient. If the goal is to strengthen SMEs’ ability to exploit their growth potential there must be greater focus on the factors within undertakings. Research shows that growth is hampered by a number of internal factors and an understanding of these is a prerequisite for being able to create the right tools for SMEs. The financial crisis, rapid market changes, globalisation, technological developments etc. have put pressure on SMEs. As the Greek philosopher Heraclitus said: ‘The only thing that is constant is change’. But not even Heraclitus could have foreseen the extent and speed of the changes that SMEs face. This creates an urgent need for understanding what hampers or drives growth in SMEs. The aim of this contribution is to shed light on some of the internal factors that can be barriers to growth in SMEs and to discuss some tools that may help SMEs overcome some of these internal barriers to growth. The contribution will draw on the existing literature on rapidly growing SMEs and on SME failures. The contribution will also take account of some new empirical studies of Danish SMEs. Regardless of their country of origin SMEs face the same problems, so it is fair to assume that national empirical studies will, at least to some degree, reflect the general situation.

Does E-Commerce Provide a Sustained Competitive Advantage? An Investigation of Survival and Sustainability in Growth-Oriented Enterprises

Enterprises should find a new business model for their development, so as to make better use of their own advantages. At the same time, with rapid development of the economy and of science technology, the competition between small and medium-sized enterprises (SMEs) and large enterprises is inevitable, so it is very important for small and medium-sized enterprises to find better ways to improve their ability to compete. E-commerce is a new medium of commerce in this 21st century, so as to promote the quantity development of SMEs and enhance the risk management ability of enterprises. However, at present, many of China’s small and medium enterprises face many challenges in the process of electronic commerce’s development, such as, which factors hinder the performance of electronic commerce, and what aspect of enterprises should be improved? This paper is based on the above problems, using theoretical analysis and empirical research methods to explore the root of these problems and find the solutions. In the empirical section, we explore how e-commerce influences sales growth in the short- and long-term. Through analysis of e-commerce performance, we further explore the causality relationship and influence degree. The results show that: first, IT Investment is the most important factor to achieve success, what competitive advantage can be achieved largely depends on whether enterprises will effectively use the network technology; second, the expansion of the enterprise size can promote transaction volume increase of SMEs in the short term; third, internet availability has a positive effect on the trade volume of e-commerce, but the intensity is not obvious, and the effect is relatively stable.

SPECIFIC FEATURES OF THE INTELLECTUAL PROPERTY COMMERCIALIZATION STRATEGIES OF SMALL AND MEDIUM-SIZED ENTERPRISES

The overview of the European and Russian judicial practice confirmed the opinion that high financial risks associated with litigation costs often do not allow Russian small and medium-sized enterprises (SMEs) to use the formal intellectual property protection system. The carried-out analysis showed that Russian measures to stimulate the development of innovative SMEs are quite competitive in comparison with the international analogues. Meanwhile the proposed corrections give the opportunity to the governmental programmes to provide more stable support for the domestic companies.

Regional Development and Support of SMEs – How University Project can Help

Small and medium-sized enterprises (SMEs) play a crucial role for the Slovak economy. They constitute of more than 99% of the total number of businesses and employ more than 41% of all employees. Support of starting entrepreneurs is an important tool for increasing employment in the economy. The sector of SMEs is also important for regional development, because SMEs use mostly local resources and their profit remains in the region. SMEs are at the same time very sensitive to changes in the economy, and more than 60% of them go bankrupt during the first three years after establishment. There exist different kinds of support for SMEs, one example is a special Consulting and Development Centre (PRC) which was established at the Faculty of Management, Comenius University in Bratislava. Academic background with the support of external experts from private sector allows effective transfer of knowledge between students and starting entrepreneurs. Young graduates and students, especially technicians, IT experts and other specialists, have interesting business ideas but lack managerial skills and economic knowledge. PRC, with participation of students of management, is trying to fill this market gap.

Innovation Policy as the Main Accelerator of Increasing the Competitiveness of Small and Medium-sized Enterprises in Slovakia

The importance of innovative activities lies in the development of future competitiveness, improving the efficiency of the economy as well as its ability to act. Effective innovation development requires the existence of functional innovation system consisting of institutions, policies and tools which create conditions to foster innovation. Small and medium-sized enterprises (SMEs) play an important role. The fundamental problem of a lack of innovation development in Slovakia is non-systematic tools focusing on companies that do not have sufficient resources. Although the problem is the lack of innovation knowledge base, as well as poor innovation management. The aim of the article is to provide a general picture of the innovation development of Slovakia. Introductory part of the article is a historical guide of innovation development, presented are the basic directions and tendencies of development of the innovation system, with attention focused mainly on the lack of linkage between business sector and scientific research activities of universities. The analytical section is devoted to the research results realized in Slovakia. In the first research we deal with the financing of innovative development of SMEs, venture and development capital, which is in Slovak conditions used insufficiently. In the second research we have looked at issues of innovation development in the healthcare sector and we bring selected partial results.

Financing Difficulties of SMEs from Its Financing Sources in China

With the rapid development of global economy, the reform and opening up policy of China has provided good opportunities for the vigorous development of small and medium-sized enterprises (SMEs). And SMEs have become the important force of sustained, rapid and healthy development of China's economy. Moreover, SMEs have played an irreplaceable role in promoting China’s economic development, absorbing labors and promoting market prosperity. But with the global economic integration, the domestic small and medium-sized enterprise’s operating environment is facing tremendous changes and more intense competition. This paper introduces the sources of SMEs’ financing, analyzes its financing difficulties and causes from its sources, and aims to benefit the development of SMEs in the near future.

Estimation of the Treatment Effects of Ownership on the Indirect Financing of Small- and Medium-Sized Enterprises

Small- and medium-sized enterprises (SMEs) are the important driving forces for the growth of China’s economy. However, financing difficulty has always been the important problem besetting the development of SMEs for a long time. In particular, in recent years, US subprime crisis in 2008 caused a heavy blow to the development of some externally oriented SMEs. Thus, how to effectively overcome financing predicament for the SMEs is crucial for Chinese government. In this paper, based on microdata from China Industrial Enterprise Database, propensity score matching (PSM) method is adopted to conduct empirical analysis about the treatment effects of indirect financing level of SMEs under different systems. Empirical results reveal that state-owned enterprises enjoy indirect financing advantages compared with other enterprises and there is certain ownership discrimination against foreign-funded enterprises and private enterprises. In particular, the indirect financing rate of state-owned enterprises is 1.4% higher than that of other enterprises, and the indirect financing rate of foreign-funded enterprises is 6% lower than that of other enterprises; private enterprises are advantageous in indirect financing compared with other enterprises; however, indirect financing rate of private enterprises is 1.8% lower than that of state-owned enterprises, which also reveals ownership discrimination to certain extent.

A credit policy study of Chinese banks on small and medium-sized enterprises

In recent years, there is rising attention on the difficult financing problems of small and medium-sized enterprises (SMEs). With constant development and improvement in China’s socialist market economy system, SMEs is becoming a pivotal part of China’s national economy. It can be said that the development of SMEs makes a great contribution to China’s national economy development. However, SMEs are facing financing bottlenecks at the same time. This is not only because of the limited financing capabilities of SMEs themselves but also because of the various commercial bank credit policies. It is necessary to solve credit policy problems between SMEs and banks, not only for SMEs but also for the further development of commercial banks. This paper analyses the problems and the reasons of “credit grudging” behavior of China’s commercial banks and SMEs financing difficulties through a critical analysis. This paper also uses the method of the dynamic game theory to probe into credit problems between SMEs and commercial banks under the condition of information asymmetry. At the end of the paper, conclusions are made and suggestions are proposed for a win-win solution concerning credit policy problems between SMEs and commercial banks.

Analysis of barriers to entrepreneurship in Small and Medium-sized Enterprises (SMEs)

Today entrepreneurship is considered as the economic driving engine for developed and developing countries and most countries have invested considerably on entrepreneurship development. The entrepreneurship development in a community could provide sustainable employment and economic development. It should be noted that entrepreneurship development has always been encountered different challenges and barriers. The present article is aimed to detect and classify the barriers of entrepreneurship development in Iranian SMEs and determine the importance of each barrier. Analyzing 28 detected barriers in the present study show that lack of sufficient knowledge in management skills, business management, lack of adequate investment to start and retain a business, difficulty in finding information about markets, products and prices, troublesome rules obtaining bank loans, and the difficulty in recruiting good and reliable staff are the most important barriers and

A study of a university-led entrepreneurship education programme for small business owner/managers

The small- and medium-sized enterprise (SME) sector is crucial to regional and national economies [Thorpe, R., J. Cope, M. Ram, and M. Pedler. 2009. Leadership development in small-and medium-sized enterprises: The case for action learning. Action Learning: Research and Practice 6, no. 3: 201–8; Jones, O., A. Macpherson, and R. Thorpe. 2010. Learning in owner-managed small firms: Mediating artefacts and strategic space. Entrepreneurship and Regional Development 22, no. 7/8: 649–73]. In recognition of this, Higher Education Institutions (HEIs) have been supported through government policy to provide training programmes for SMEs aimed at developing a higher level of skills that will support growth [Lambert Review of Business-University Collaboration. 2003. Final Report, KM Treasury, London. http://www.hm-treasury.gov.uk; HM Treasury. 2006. The Leitch Review of Skills: Prosperity for all in the global economy – World class skills. London: HM Treasury; DIUS (Department for Business Innovation Universities and Skills). 2007. Implementing ‘The race to the top’: Lord Sainsbury's review of government's science and innovation policies. TSO; DIUS (Department for Business Innovation Universities and Skills). 2008. Higher education at work: High skills, high value. http://www.bis.gov.uk/assets/biscore/corporate/migratedD/ec_group/HLSS4_08 (accessed February 7, 2011); Zhang, J., and E. Hamilton. 2010. Entrepreneurship education for owner-managers: The process of trust building for an effective learning community. Journal of Small Business and Entrepreneurship 23, no. 3: 249–70]. This study considers the relationship between entrepreneurship education and SME owner/managers by examining a programme delivered by a HEI for growth-oriented small business owner/managers. It addresses the questions: What factors do participants believe enhance the effectiveness of HEI and SME engagement? And what impact, if any, do participants perceive such engagement has upon them as an individual operating within an SME and their business operations? Qualitative techniques are used to explore the situations of five SME owner/managers at three points during a 5-year period. Findings show that entrepreneurship education delivered a range of benefits to SMEs and the region. Through engaging, owner/managers interacted with others. This extension of their network supported business growth and development. This study demonstrates that enterprise education can deliver positive benefits to SME owner/managers and the wider region in which they are located.

An Identification of Unsuccessful, Failure Factors of Technology Innovation and Development in SMEs: A Case Study of Components and Material Industry

Despite the widespread recognition of the important roles that innovative, technology-oriented small and mediumsized enterprises (SMEs) play in most economies, relatively little research has been focused on the integratedaspects of technology, management and the related factors in the context of SMEs. Since there are no well-definedor established research models or frameworks, we adopted an exploratory, longitudinal approach to investigatekey factors that affect success or failure business cases in Korean components and materials industry. Withforty-five case study analysis, we found three important factors for technology-oriented SMEs business successesor failures. These include technology factors (market-oriented technology; timely innovative technology;technology innovation capability; patents), management factors (financial resource; management commitments;human resource; R&D capability; commercialization capability), and the related factors (top managers' ethicalissues; transparency in R&D budgets; lack of commitments for success). We highlight the importance of theintegrative approach which combines technology, management, and the related factors to examine successful orfailing business cases. Further studies will benefit from our findings to develop theoretical models and examineother industries.